The Social Security Fund approved an addendum for $37 million to carry out additional work on the construction of Hospital City, which is being developed by the construction company FCC.

A statement from the Social Security Fund indicates that"...The addendum includes the extension of the validity of the work contract to Consorcio Construcciones Hospitalarias, S.A. until December 31, 2018 and the approval of 11 exchange orders that group together additional work requested from the contractor from the year 2013 to date."

Reports state that the swiss UBS and Mexico's Inbursa are the banks that could lead the new financing structure for finishing construction of Line 2, which is currently 33% complete.

Following the departure of the group of banks led by Citibank, the construction consortium FCC and Brazil's Odebrecht have informed the Secretariat of the Panama Metro that negotiations have now been finalised with two banks to secure financing to complete the work.

The consortium formed by Odebrecht and FCC Construction is negotiating with international banks to redefine the funding structure for the project, valued at $2 billion.

Since the start of the revelations of the corruption scandal in which the Brazilian construction company Odebrecht was involved, doubts have arisen about how this could affect financing of the construction project for Line 2 of the Panamanian Metro, whosecontract was awarded in June 2015under the turnkey format.

The consortium formed by Odebrecht and the Spanish company FCC will have to find a new bank to grant the funds that Citibank was supposed to provide under the original financing structure.

The exit of Citigroup from the $1,857 million financing structure for the design and construction of Line 2 of the Panama Metro could be due to the recent deterioration in the risk perception of the Brazilian company Odebrecht, whose rating Fitch cut on May 3, citing the "... the increased risk and uncertainty associated with lack of publication of the financial statements of the company at the end of April."

The FCC and the Social Security Department have agreed to resume construction works for the project on January 15, 2016, aiming to finish it in September 2018.

Work on the construction of the Hospital City will resume on January 15, 2016 with a workforce of approximately 2000 employees, following an agreement between the Social Security Department (CSS), the Government of the Republic of Panama and representatives of the company FCC in order to have the project ready in September 2018.

The Spanish company FCC is claiming $48 million from the state for damage caused by the stoppage of work because of the audit requested by the Social Security Department.

The company argues that the works were paralyzed without taking into account the conditions laid down in the agreement to resolve these problems. The project was delayed due to an audit requested the Social Security Department, which, at the time, found at least 39 failures in planning.

Metro de Panama, SA informs that the Public Procurement Department has received a claim filed by the consortium Panametro, and ordered a suspension measure on the act to award a best value tender with separate evaluation for: the "Line 2 Metro de Panama ", pending the grievance process, brought on Tuesday 19 May.

With an offer of $1.857 million, the same consortium that was in charge the development of Line 1, has emerged as the winner of the tender for the design and construction of Metro Line 2.

Besides Odebrecht and FCC, the consortium UTE PANAM II, consisting of Dragados SA (Spain), Ingenieros Civiles Asociados SA de CV (Mexico) and Grana y Montero SA (Peru) bid in the tender for the construction of Line 2, and their proposal received a score of 317 points in the first evaluation, after bids were opened.

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